Australia rises to second most popular Asia-Pacific HQ destination

Singapore has been the most popular Asia-Pacific headquarters location from 2014 onwards, according to fDi Markets, but Australia is closing the gap.

The number of companies choosing Australia to establish an Asia-Pacific headquarters is on the rise. Between January 2009 and December 2014, Australia ranked third for headquarters facilities in the region (after Singapore and China). However, data from 2014 onwards, recorded by fDi Markets, shows that Australia has overtaken China and is now the second most popular choice for investors.

Between 2015 and 2016, the number of headquarter projects going into Australia increased by 46.66%, equating to a market share of 18.18%. The number of jobs created also increased from 1370 to 1600 and capital expenditure increased from $391m to $336.5m. On top of this, date for 2017 (to September) indicates further growth. Headquarter investment into Australia in the first quarter of 2017 experienced a 75% increase compared with the first quarter of 2016, with an increase in capital expenditure and job creation of 104.02% and 96.3%, respectively. Quarter two also experienced significant growth of 33.3% compared with quarter two of 2016, along with an increased capital expenditure of 58.34%. Headquarter investment into Australia in the third quarter of 2017 decreased slightly from the same period in 2016, with project numbers dropping from 10 to seven. In contrast, capital expenditure has continued to rise, showing an increase by $3.53m.

The primary source markets for Australian headquarter investment between January 2015 and September 2017 were the US, which accounted for 47.27%, followed by the UK, which represented 9.1%, and China (7.27%). The leading industry sectors for investment were software and IT services, consumer products and communications.

Since fDi Markets began recording data, the primary reason for investing in Australia has been proximity to market and customers, cited by 35.3% of investors, followed by domestic market growth potential, with 33.8%, its skilled workforce (20%) and investment promotion agency and government support (16.9%). Australia was recently ranked 15th out of 190 in the World Bank’s ‘Ease of Doing Business’ ranking, placing seventh for ‘starting a business’ and third for ‘enforcing contracts’.

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